JAGAT ENTERPRISES vs. INCOME TAX OFFICER AND OTHERS

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CWP/7634/2025HC Punjab & HaryanaPHHC01043712202519 March 2025Bench: MR. JUSTICE ARUN PALLI,MRS. JUSTICE SUDEEPTI SHARMA2 pages
AI SummaryRemanded

What did the High Court hold?

The High Court allowed the writ petition, disposing of it in terms of the judgments in Jatinder Singh Bhangu's case (decided on July 19, 2024) and Jasjit Singh's case (decided on July 29, 2024). In those cited cases, the Co-ordinate Bench had allowed similar writ petitions on the same issue. The reasoning was that the issuing authority lacked jurisdiction to issue the Section 148 notice, as per the CBDT circular dated March 29, 2022, which designated the NFAC with exclusive power. The High Court granted liberty to the revenue to follow the procedure laid down under the Act, 1961, and proceed accordingly, if so advised. The operative direction was to quash the impugned notice and consequential proceedings, with liberty to the revenue to re-initiate the process if they chose to do so following the correct procedure.

What were the facts?

The petitioner, Jagat Enterprises, filed a writ petition challenging a notice dated March 20, 2024, issued under Section 148 of the Income Tax Act, 1961, and consequential proceedings for Assessment Year 2021-2022. The petitioner argued that the authority issuing the notice lacked jurisdiction, citing a CBDT circular dated March 29, 2022, which allegedly vested exclusive power to issue such notices in the National Faceless Assessment Centre (NFAC). The respondents, the Income Tax Officer, Ward 2 (2), Gurgaon, and others, were represented by senior and junior standing counsel. The High Court of Punjab and Haryana at Chandigarh heard arguments from both sides.

What were the issues?

1. Whether the notice dated March 20, 2024, issued under Section 148 of the Income Tax Act, 1961, for AY 2021-2022, is invalid due to lack of jurisdiction of the issuing authority, in light of the CBDT circular dated March 29, 2022? (Question of law and fact) Assessee's contentions: The petitioner contended that the issuing authority lacked jurisdiction to issue the Section 148 notice. This contention was based on the CBDT circular dated March 29, 2022, which purportedly grants exclusive power to the NFAC to issue such notices. The petitioner relied on the judgments of a Co-ordinate Bench of the High Court in Jatinder Singh Bhangu vs. Union of India and others (CWP No. 15745-2024) and Jasjit Singh vs. Union of India and others (CWP No. 21509-2023). Revenue's contentions: The learned counsel appearing for the Union of India did not dispute the petitioner's contentions.

Which sections of the Income-tax Act were involved?

Section 148

AI-generated summary — verify with the full judgment below

CWP-7634-2025 1 IN THE HIGH COURT OF PUNJAB AND HARYANA AT CHANDIGARH 195 CWP-7634-2025 (O&M) Date of Decision:-19.03.2025 Jagat Enterprises ....Petitioner Vs. Income Tax Officer, Ward 2 (2), Gurgaon & ors. ...Respondents CORAM: HON'BLE MR. JUSTICE ARUN PALLI HON'BLE MRS. JUSTICE SUDEEPTI SHARMA Present: Mr. B.M. Monga, Mr. Rohit Kaura and Mr. Rajiv Sharma, Advocates, for the petitioner. Mr. Varun Issar, Sr. Standing counsel with Ms. Pridhi Sandhu, Jr. Standing counsel for the respondent. *** SUDEEPTI SHARMA, J. 1. Challenge in the instant writ petition is to notice dated 20.03.2024 issued under Section 148 of the Income Tax Act, 1961 (for short ‘Act 1961”) and consequential proceedings , for AY 2021-2022. 2. Learned counsel for the petitioner contends that the issue involved in the present writ petition is covered by the judgment passed by a Co-ordinate Bench of this Court in the cases of Jatinder Singh Bhangu vs. Union of India and others, passed in CWP No. 15745-2024 and connected matter, decided on 19.07.2024 and Jasjit Singh vs. Union of India and others (CWP No. 21509-2023 and other connected matters), decided on 29.07.2024 . 3. Learned counsel appearing for Union of India has also not disputed the same. 4. We have heard learned counsel for the parties and perused the Gaurav Arora 2025.03.24 14:53 I attest to the accuracy and integrity of this document

CWP-7634-2025 2 whole records of the case. 5. The petitioner has challenged the notice dated 20.03.2024 issued under Section 148 of the Act, 1961 and consequential proceedings for AY 2021-2022, on the ground that the Issuing Authority had no jurisdiction to issue the same, in view of the circular/notification dated 29.03.2022 of the CBDT, wherein, it has been specifically enumerated that the NFAC has exclusive power to issue the notice under Section 148 of the Act, 1961. 6. A Co-ordinate Bench of this Court in Jatinder Singh Bhangu’s case (supra) and Jasjit Singh’s case (supra), allowed the writ petitions on the same issue, as raised in the present writ petition, by granting liberty to the revenue to follow the procedure as laid down under the Act, 1961 and proceed accordingly, if so advised. 7. In view of the above, the present writ petition is disposed of, in terms of Jatinder Singh Bhangu’s case (supra), decided on 19.07.2024 and Jasjit Singh’s case (supra), decided on 29.07.2024 8. All the pending applications, if any, also stand disposed of. (ARUN PALLI) (SUDEEPTI SHARMA) JUDGE JUDGE 19.03.2025

Gaurav Arora

Whether speaking/reasoned : Yes/No Whether reportable : Yes/No Gaurav Arora 2025.03.24 14:53 I attest to the accuracy and integrity of this document

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